Britain set to provide funds for the development of all-new Turkish railway infrastructure

The British government has given the go-ahead for £680 million in financing to be provided for the construction of an all-new electric railway across the southern regions of Turkey. The railway, expected to be 286km in length and ensure quick travel, is being built to help there be much less CO2e emitted from train activity.

The funds will be authorised by the British government's export credit agency, UK Export Finance (UKEF) and handed out through the agency's Buyer Credit Facility. Turkish investment and contracting company, Ronesans Holding, will handle the construction of the new electric railway with the Turkish Ministry of Transport overseeing the process.

The new railway infrastructure will ensure there is more convenient access in travelling between certain southern-based cities in Turkey which include Osmaniye, Gaziantep, Adana and the port city home to over a million people and the second biggest container port in Turkey, Mersin.

This railway construction will play a significant role in ensuring the British economy grows, one of Prime Minister Rishi Sunak's key priorities, as further lucrative export contracts will be available to those from project management, engineering and infrastructure sectors in Britain.

Exporters from Britain are set to benefit here and there is little worry to have over not being involved with the construction as the finances provided by UKEF have been allocated on the basis that British exporters are involved with the railway project.

Minister for Exports, Lord Offord, touched on what this high-speed railway project signals for Britain's ties with Turkey and British transport prowess. He stated: "The UK-Turkey trading relationship is going from strength to strength. This deal shows that the UK, home to the world's first railway system, still moves full steam ahead with its export of railroad innovation and expertise."

Ronesans Holding is among the top 10 biggest construction organisations in the whole of Europe and will use this new electric railway deal to allow them to bolster the connections it has with Britain's supply chain. The Turkish company has been in talks with British suppliers over finding arrangements over working contracts for ESG consultancy services, electronic infrastructure, catenary as well as mechanical parts.

President of Ronesans Holding, Dr Erman Ilicak, expressed his delight at being a part of this Turkish railway infrastructure project. He said: "We're thrilled to be working with UKEF, JP Morgan, ING and BNP to secure a deal that will enable a landmark shift in the Turkish construction of rail links and the high-speed railway project."

He added: "Rönesans Holding takes immense pride in contributing to Turkey's national environmental goals and infrastructure advancement."

In order to successfully close out a deal for this all-new electric railway project, UKEF secured a loan from collaborations with J.P. Morgan, ING Bank and BNP Paribas. Also, Italy's SACE, and Austria's OeKB, were two export credit agencies that UKEF found to work with to ensure reinsurance.

The existing railway line works on diesel locomotives so by constructing a new electric-functioning alternative, there will be less carbon emitted with the travel routes between Mersin and Gaziantep. Crucially, the opening 12 months will see CO2e emissions on the railway be cut by 157,000 tonnes.

The new electric line will be able to handle trains travelling at rapid speeds, reaching up to 200km/h, and is strong signalling of growth within Turkey's railway infrastructure. The quick train journeys will result in the travelling time from Gaziantep, through Adana and Osmaniye, to Mersin being considerably cut down by four hours.

One of Turkey's priorities is to increase the length of its ultra-fast railway coverage to 10,000km, which would stretch further than the distance from London right up to Cardiff. This new project will help contribute massively to this and play an influential role in the evolution of Turkey's railway infrastructure.

Treasury and Finance Minister for Turkey, Mehmet Simsek, spoke on the importance of the project and what it will lead to. He pronounced: "This project will ensure a reduction of transportation costs, decrease travel time between Mersin and Gaziantep and strengthen our railway connectivity."

Simsek added: "In this regard, this project is crucial for economic, social and environmental integration. We are very grateful to our trading partner UKEF for their contribution to this important project, which will expand the national railway network."

The eastern terminus of the Turkish railway is located in Gaziantep, which was in the surrounding areas right by the recently occurred 7.8 magnitude earthquake in Turkey this past February.

The finances that UKEF are providing for the rail project will also allow for rebuilding work that needs attending to in Gaziantep and other locations in the south of Turkey in need of repair.

Elsewhere, the British government has recently handed out travel warnings to the 1.6 million Brits that are expected to fly to Turkey this summer because of terrorist threats.